Retail is cooked…

Mom-and-pop investor sentiment has reached the highest level on record, surpassing what was seen during the meme-stock mania in 2021, according to Emma Wu, JPMorgan’s global quantitative and derivatives strategist.

Even as US stocks got hit on Monday (Feb 3) when President Donald Trump’s tariff negotiations rattled global markets, mom-and-pop investors continued to buy in. They poured US$3 billion into stocks that day and then broke the US$2 billion threshold within the first 1.5 hours of trading on Tuesday – the largest inflow at that time of the trading session back to 2015, a JPMorgan analysis shows.

“Retail traders are looking at sell-offs opportunistically,” said Bret Kenwell, eToro’s US investment analyst. In a December eToro survey, 59 per cent of respondents said they’re bullish on AI stocks but just 22 per cent had exposure to this group and that majority of them were looking for an opportunity to buy AI names sometime in 2025.

TLDR: Institutions have not only stopped buying but are literally eyeing the amount of retail currently buying like an aberration…